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A luxury bag company from France decided to lower its export price to Australia to help compensate for import tariffs being placed on their bag, this is an example of:

a. Economic quota action theory
b. Dumping
c. Essential-industry argument
d. Optimum-Tariff theory
e. Anti-dumping practice

1 Answer

3 votes

Final answer:

Lowering the export price to compensate for tariffs is an example of dumping, which is selling goods below their cost of production. Anti-dumping laws regulate imports sold below their true cost.

Step-by-step explanation:

The luxury bag company lowering its export price to Australia to compensate for import tariffs is an example of dumping. Dumping refers to selling goods below their cost of production, and it is not allowed under World Trade Organization (WTO) rules. Anti-dumping laws block imports that are sold below the cost of production by imposing tariffs to reflect their true cost.

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